Steel Mills
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Cliffs still interested in buying USS: Goncalves
Written by Ethan Bernard
April 1, 2024
Cleveland-Cliffs’ Lourenco Goncalves said the company is still interested in acquiring U.S. Steel, though no bid is currently on the table, according to a local report.
“Of course I’m still interested in acquiring U.S. Steel; it doesn’t mean I have a bid on the table,” Goncalves, Cliffs’ chairman, president, and CEO, said in an interview with News 5 Cleveland on March 27.
“They passed on the opportunity to sell for more and to sell to a company that had the full support of the USW. Now they will have to handle the consequences of their decision,” he added.
The United Steelworkers (USW) union has come out against Japan’s Nippon Steel’s attempt to acquire U.S. Steel, a deal first announced in December. So far, talks between the USW and Nippon have not yielded any change in the union’s position.
The deal still faces regulatory hurdles, and both President Biden and former President Trump have said they are opposed to the deal. Nippon still maintains the benefits of the proposed acquisition.
Auto trade group opposes Cliffs buy
Separately, the Alliance for Automotive Automation (AAI) has come out against any potential Cliffs deal for Pittsburgh-based U.S. Steel.
In a letter sent to the White House on March 29, John Bozzella, president and CEO of AAI, said there were media reports indicating the Biden administration found that brokering a Cliffs buy of U.S. Steel wasn’t “feasible.”
“That was an appropriate conclusion and it should remain the administration’s official policy toward any attempt by Cleveland-Cliffs to acquire all or parts of U.S. Steel in the future,” Bozzella said in the letter.
“In fact, given the current holdings of Cleveland-Cliffs, any combination between it and U.S. Steel deserves at least the same or more antitrust scrutiny,” he added.
Regarding a combined Cliffs and U.S. Steel, Bozzella cited concerns regarding the concentration of US iron ore mining and processing, automotive, as well as “100% of blast furnace production in the US.”
“That result could lead to anti-competitive pricing of materials used by steel-reliant manufacturers like the auto industry, drive up the cost of both steel and e-steel, and ultimately increase the cost of finished vehicles (including EVs) for American consumers,” Bozzella said.
If the government evaluates alternate outcomes, he said, “One option that should not be on the table is an arrangement that creates a market concentration of domestic steel production in a single company.”
USS statement to customers
On a joint website between Nippon and U.S. Steel touting the deal, USS issued the following statement to customers on March 29:
“U.S. Steel’s transaction with Nippon Steel ensures a competitive, domestic steel industry, with the new combined company offering capabilities and innovation that can meet our customers’ evolving needs,” the statement said.
“The companies share a deep commitment to delivering high-grade steel, such as electrical steel and automotive steel, to customers in North America,” the statement concluded.
A request for comment from Cleveland-Cliffs was not returned by time of publication.
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Ethan Bernard
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